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Financial Literacy and the Corporate Governmentalization of the ‘Business of Life’

Højbjerg, Erik(Frederiksberg, 2014)

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Abstract:

This
paper
is
a
work-­‐in-­‐progress.
The
purpose
of
the
paper
is
programmatic
in
the
sense
that
it
tries
to
formulate
elements
of
a
research
agenda
revolving
around
the
issue
of
corporate
governmentalization.
By
this
term
I
intend
to
indicate
ways
in
which
companies
seek
to
construe
and
mobilize
consumer
subjectivities
whose
consuming
practices
involve
the
self-­‐
management
of
the
individual
along
etho-­‐political
goals
of
good
governance.
The
back-­‐drop
of
this
topic
is
the
investigation
of
the
forms
of
contemporary
social
and
political
transformation,
with
a
focus
on
the
transformative
powers
of
‘politicized
private
enterprises’
or
the
‘political
corporation’.
The
research
question
is:
How
do
corporations
seek
to
construe
and
mobilize
responsible
citizens
by
offering
products
and
services,
the
consumption
of
which
are
assumed
to
transform
the
individual¹s
self-­‐relationship
along
proclaimed
ethical
and
political
goals?
The
research
question
will
be
discussed
in
the
context
of
financial
literacy
educational
initiatives.
In
the
aftermath
of
the
2008
global
financial
crisis,
increasing
the
financial
literacy
of
ordinary
citizen-­‐consumers
has
taken
a
prominent
position
among
regulators
and
financial
institutions
alike.
The
logic
seems
to
be
that
financially
capable
individuals
will
enjoy
social
and
political
inclusion
as
well
as
an
ability
to
exercise
a
stronger
influence
in
markets.
The
paper
specifically
contributes
to
our
understanding
of
the
governmentalization
of
the
present
by
addressing
how
-­‐
at
least
in
part
-­‐
the
corporate
spread
of
financial
literacy
educational
initiatives
can
be
observed
as
a
particular
form
of
power
at-­‐a-­‐distance.
The
focus
is
on
the
role
of
private
enterprise
in
governmentalizing
the
‘business
of
life’
by
establishing
and
mobilizing
specific
conceptual
forms
around
which
the
life
skills
of
the
entrepreneurial
self
involves
a
responsibilization
of
the
individual
citizen-­‐consumer.

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We examine the argument, put forward by modern management writers and,
in a somewhat different guise by Austrian economists, that authority is not a
viable mechanism of coordination in the presence of "distributed knowledge"
(which corresponds to Hayek’s treatment of the use of dispersed knowledge
in society). We define authority and distributed knowledge and argue that
authority is compatible with distributed knowledge. Moreover, it is not clear
on theoretical grounds how distributed knowledge impacts on economic
organization. An implication is that the Austrian argument that designed
orders are strongly constrained by the Hayekian knowledge problem (Hayek,
Kirzner, Sautet) is shaky. The positive flipside of this argument is that
Austrians confront an exciting research agenda in theorizing how distributed
knowledge impacts economic organization.

Files in this item: 1

Although there is reason to expect that outsourcing plays an increasingly important role in
world of commerce, theories of firm boundaries poorly address associated processes of
governance change. This paper seeks to address this gap in the spirit of the evolutionary
theory of the firm. This approach highlights the significance of outsourcing as a "process of
shifting from internal to external procurement of activities." Adopting an evolutionary
process perspective suggests limits to outsourcing due to governance inseparability and
partly tacit complementarity of capabilities as well as related dis-aggregation costs,
including the costs of knowledge codification in the specification of interfaces in
supplier/buyer relations, loss of absorptive capacity and integrating capabilities in the
supplier’s system. A key departure from earlier approaches to firm boundaries is an
explanation of such limits to outsourcing and their impact on two interrelated sources of
efficiency: incentives and capabilities. For instance, when limits to outsourcing obtain,
governance change for particular activities involves compromises of capability- and/or
incentive efficiency in the experimental determination of organizational boundaries. Also
discussed are environmental dynamics that variously emphasise efficiency properties of
dispersed or concentrated ownership and capability development.

Files in this item: 1

Exploring some benefits of constraints on creativity and aesthetic value creation

Frandsen, Thomas; Friis, Ivar; Hansen, Allan(Frederiksberg, 2011)

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Abstract:

This paper explores the role of budgeting in the Danish film industry and seeks to illustrate the
positive effects a line-budget might have on the creativity and innovativeness in film production. In
our analysis we provide illustrative examples of the enabling and facilitating role of budget
constraints on film production from the Danish film industry in general as well as from a case study
of the process of making the Danish film “The Island of Lost Souls” in particular. We draw on
Elster (2000)’s constraint theory and suggest that the constraints imposed on agents by line-item
budgeting under some circumstances lead to situations where ‘less is more’ as line-item budgeting
might be used to focus creative behavior as well as pre-commit the agent against passion and time
inconsistency.

The theoretical discourses devoted to smell reflect a maze of fascinating taboos and mysterious attractions. In present-day Western societies, the sense of smell is undervalued. Scents are highly elusive and often cannot be directly named. Many languages have virtually no vocabulary to describe them, except in terms of the other senses of sight, sound, touch and taste. Scents are communicated primarily through metaphors. What are these linguistic and visual metaphors, and what do they tell us about the societies and cultures in which they are used? How do we know what scents ‘mean’? Is smell a universal form of semiotic communication (as global advertising campaigns suggest), or does it vary in different social and cultural contexts (as anthropological and other literature asserts)? Are there specific ‘scent cultures’? If so, in what do they consist? And how do these affect the creation, appraisal and use of fragrances in the three countries – Japan, France and the USA – in which I intend to conduct my research?

This paper investigates barriers to the process of regional economic development from a linkage perspective. It develops the concepts of linkage lock-in and switching costs as fundamental factors explaining some of the social dynamics of the process. The overall claim of the paper is that different types of costs and their determinants may lock firms in to existing linkages, creating a probable barrier to successful regional economic development. The paper defines linkage lock-in as the difficulty in switching to alternative linkage partners, even if this is desirable. Switching costs are the costs involved in terminating and forming linkages. The extent of transaction costs, dynamic transaction costs and opportunity costs delineate switching costs in interfirm linkages. The paper further elaborates on the concept of opportunity costs; it states that in dynamically competitive environments a class of opportunity costs, namely learning opportunity costs might arise as a result of the relative importance of learning and innovation. Learning opportunity costs are defined as the costs of missing key possibilities to learn in dynamically competitive environments. They are furthermore seen as being constituted by cognitive costs, which in turn are influenced by the existence of information costs. The theoretical argument is illustrated by a case study of the medical part of the Øresund medi-tech plastic industry. Key words: Regional economic development; interfirm linkages and switching costs; lock-in and learning; cross-border business; medi-tech plastic industry. JEL classifications: D83, L14, L22, L68, R58

How can service companies get their employees to ‘live the brand’? This thesis answers this
question through a dialogue between practice and theory. It investigates the potential of
philosophical-dialogical methods to transform abstract brand values into action in corporate
branding praxis at TDC and explores opportunities to apply the methods in context of service
companies in general. It develops an understanding of corporate branding as an organisational and
cultural project in which collective dialogue-processes serve as the main sensemaking process.

This paper studies how interest group lobbying of the bureaucracy affects policy
outcomes and how it changes the legislature’s willingness to delegate decision-making
authority to the bureaucracy. We extend the standard model of delegation to account
for interest group influence during the implementation stage of policy and apply it
to different institutional structures of government. The paper addresses the following
questions: First, how does the decision to delegate change when the bureaucratic agent
is subject to external influence? What cost does this influence impose on the legislative
principal? Finally, how susceptible are policy choices to bureaucratic lobbying under
different government structures? In answering these questions, the paper seeks to provide
a comparative theory of lobbying and to explain the different patterns of interest
group activity across political systems.

Files in this item: 1

A thorough literature review shows how it is well established in the literature that
performance appraisal (PA) in modern organisations is infused with many problems.
However, at the same time PA is one of the most institutionalised features of running
large corporations everywhere in the Western world. Problems in PA challenges
managers and employees and provoke important local adaption and meaning
creation processes across workforces in order to allow a meaningful fit between the
practice of PA and the task at hand in each workforce.
Through 34 qualitative interviews with manager-employee dyads, the study design
included a comparative study of local adaption and meaning creation in PA across
four different workforces over a full one-year PA-cycle in a case organisation where a
one-size-fits-all PA scheme had been implemented. Important differences in
environmental dynamics and in manager and employee enactment patterns were
found. Understanding these patterns is not only important for our understanding of
how PA schemes affect individuals' and organisations' performance. It is also more
fundamentally important to our understanding of the dynamics of the problems in PA
which have been uncovered, analysed and attempted to be solved over the last 20
years' scholarly research into PA, without any real breakthrough.
Austin's (1996) separation between management by delegation versus management
by measurement was used as a typology of differences in the task at hand in Sales,
R&D, Production and Staffs in the case organisation. Although PA as such is clearly
designed to operate within the management by measurement paradigm, comparative
findings across workforces show that important differences are present. Particularly,
Sales and R&D form contrasting cases in terms of characteristics of the task at hand
and characteristics of PA adaption and meaning creation. Thus, the study shows how
a standard corporate PA scheme can be twisted in different directions in different
workforces to such an extent that in R&D it can even be argued that the scheme in
some ways has more similarities with management by delegation than with
management by measurement. The study discusses the implications of this and
guidance to future research is provided.

Files in this item: 1

It is by now an established fact, that the so-called high technology industries have experienced growth rates
way above average through most years. High technology industries share of the world manufacturers export
has risen from 12 per cent in 1970 to 25 per cent in 1995. More than one-third of Japan's manufacturing
export and more than 40 per cent of America's manufacturing export are products from high technology
industries, and this development has increasingly led to an international obsession with high technology
industries. In a number of countries R&D indicators have by now become the object of intense discussions.
Great efforts are devoted to improve a bad relative standing.
The aim of this paper is to questioned whether a national specialisation towards high technology industries
is the only way by which the mature, developed countries can hope to sustain and augment their economic
position. I claim that in contrast to much of the assumptions in contemporary politics and in the majority
of the contemporary academic literature on the subject the countries without a specialisation in high
technology industries are not left in the backwaters of economic development. Quite the contrary seems
to be the case as many advanced, high-cost countries experience an above average economic performance
even when specialising in the bottom end of the low-tech industries.
The argument is illustrated with empirical material from the wooden furniture industry in general - and the
rather successful Danish wooden furniture industry in particular. The possible reasons behind this apparent
paradox are discussed.

Providing a concise working definition of social capital, this conceptual paper analyses why social
capital is important for learning and economic development, why it has a regional dimension, and
how it is created. It argues that with the rise of the Knowledge Economy, social capital is becoming
valuable because it organizes markets, lowering business firms’ costs of coordinating and allowing
them to flexibly connect and reconnect. Thus, it serves as a social framework for localized learning
in both breadth and depth. The paper suggests that a range of social phenomena such as altruism,
trust, participation, and inclusion, are created when a matrix of various social relations is combined
with particular normative and cognitive social institutions that facilitate cooperation and reciprocity.
Such a matrix of social relations, plus facilitating institutions, is what the paper defines as “social
capital”. The paper further suggests that social capital is formed at the regional (rather than national
or international) level, because it is at this level we find the densest matrices of social relations. The
paper also offers a discussion of how regional policies may be suited for promoting social capital.

Files in this item: 1

The concept of localized learning outlines how local conditions and spatial proximity between
actors enable the formation of distinctive cognitive repertoires and influence the generation and
selection of skills, processes and products within a field of knowledge or activity. The localized
learning argument consists of two distinct yet related elements. One has to do with localized
capabilities that enhance learning while the other concerns the possible benefits that firms with
similar or related activities may accrue by locating in spatial proximity of one another. In this essay,
we disentangle these two inherent elements of the concept, review some of the critique that has
been raised against it, and sort out some misunderstandings that we think are attached to its present
use.

Files in this item: 1

This paper proposes a multidimensional index of regional and global orientation which can be used in confirmatory studies with econometric methodologies. Unlike extant measures, the index is objectively scaled and controls for home country orientation and market size differences. The index is shown to be consistent with models of internationalization that incorporate different assumptions about strategic choice and global competition. Preliminary results show that large multinationals follow home region oriented internationalization paths, although much of the regional effect reported by previous studies in fact reflects strong home country biases.
Keywords: globalization; regional integration; global strategy; regional strategy; local strategy; triad; liability of foreignness

Files in this item: 1

In this paper technical standardisation is understood and explained in a model where economic analysis is coupled with an analysis of the political system as proposed in rational choice theory. The aim is to answer both the question why various countries (e.g. the United States versus European countries) let either the market or public intervention determine the mode of technical standardisation and the possible implications of these two ways of organizing technical standardisation from an economic and a political point of view. Based upon the analysis of the paper a couple of general policy recommendations are made concerning the mode of technical standardisation.
Keywords: Rational choice, market failures, technical standards, standardisation, government failures.